Flat panel makers safe from rising NTD: experts
CNATAIPEI--The impact of a rising New Taiwan dollar on local flat panel makers could be limited in the near term as rival South Korea is seeing a faster pace of appreciation of its currency, analysts said Saturday.
January 13, 2013, 12:02 am TWN
By taking cues from the strength of the South Korean won and Chinese yuan due to increasing optimism toward the regional economy, traders in the local foreign exchange continued to buy into the New Taiwan dollar in recent sessions, while dumping the U.S. dollar.
On Friday, the New Taiwan dollar closed at NT$29.039 against the greenback, a new high in nearly 16 months. The gains posted by the local currency, however, were capped by the central bank's aggressive intervention, which helped the U.S. dollar recover from the day's low of NT$28.930.
H. P. Chang, vice president of WitsView, a flat screen market research division of Taiwan-based market information advisory firm TrendForce, said a rising New Taiwan dollar is not expected to have much impact on Taiwan's flat panel exporters as the South Korean won has also suffered from quick appreciation.
Samsung Electronics Co. and LG Display Co. of South Korea are competing with Taiwan's Innolux Corp. and AU Optronics Corp. (AUO) in the global flat panel market.
In the past month, the South Korean won appreciated 1.86 percent against the U.S. dollar on constant foreign fund inflows into the region, while the New Taiwan dollar gained 0.24 percent against the greenback as the central bank stepped in to cap the upside.
Chang said the near term foreign exchange rate fluctuations are unlikely to hurt Taiwanese screen makers badly, but he is more concerned about long term movements if the local currency continues to climb.